View Full Version : Panel poised to boost raise, nix health care fee hikes

04-26-06, 07:52 AM
April 25, 2006
Panel poised to boost raise, nix health care fee hikes

By Rick Maze
Times staff writer

Rejection is at hand for two key proposals in the White House’s fiscal 2007 defense budget plan, as a House subcommittee plans to provide a larger military raise while refusing to increase health care fees for working-age military retirees.

Rep. John McHugh, R-N.Y., confirmed Tuesday that the military personnel subcommittee he chairs will not approve a Bush administration proposal to increase Tricare fees for military retirees under age 65 and their families who are enrolled in Tricare Standard and Tricare Prime, the military’s health insurance programs.

“Though DoD’s proposal was meant to be a cost-saving measure, it is the wrong way to go about it,” McHugh said in a statement released by his office.

It is unusual for a House Armed Services Committee member to talk in advance about what will be included in the defense bill. But the personnel subcommittee’s strong opposition was well known, so McHugh is not saying anything unexpected.

The proposed fee increases, he said, sent a “message to the many men and women who have served our nation through their military service that we’re going back on a promise that was made them.”

“We … simply are not going to burden retirees with increased costs at this time,” he said.

Instead, the subcommittee’s version of the 2007 defense authorization bill prepared for approval Wednesday afternoon will demand two studies of military health care costs.

The studies — one by the Government Accountability Office, the bipartisan investigative arm of Congress, and the other by the Defense Department, are to fully account for health care funding and look at alternatives to fee increases.

McHugh did not mention, but several House sources confirmed, that the personnel subcommittee also will provide a 2.7 percent military pay raise Jan. 1, larger than the 2.2 percent increase proposed by the administration.

House Democrats have talked about increasing the 2.2 percent raise since it was first proposed by President Bush. By including a larger raise in the draft bill, House Republicans avoid being stuck in a position of supporting the administration’s smaller raise. Increasing the Bush proposal by a relatively modest amount, at a cost of about $250 million, also could make it more difficult for House Democrats to win support for an even bigger raise, aides said.

The 2.2 percent hike would be enough to keep pace with the average pay increase in the private sector last year. While this raise would be the amount specified in federal law for computing military and federal civilian pay increases, it would be the smallest increase since 1994, would do nothing to decrease the estimated 4.4 percent gap that still remains between military and private-sector wages and would not keep pace with inflation.

With the cost of living increasing at an annual rate of about 3.6 percent, a 2.7 percent raise would still represent a decrease in purchasing power, but it would reduce the military-civilian pay gap by 0.5 percentage point, to about 3.9 percent.

The defense budget submitted to Congress in February sets aside $263 million for additional pay raises for warrant officers, senior enlisted members and people with more than 30 years of service, but it was unclear Tuesday if the armed services subcommittee would include the targeted raises in the 2007 defense bill.

David S.C. Chu, under secretary of defense for personnel and readiness, said earlier this year that the Pentagon would like the targeted pay raises to take effect April 1, 2007.

Aides said that as of Monday, the targeted raise proposal had not been formally submitted to Congress, but a copy of the plan had been provided to the armed services committee for review.

Whether targeted raises are included in the bill could depend on the cost assigned to the proposal by the Congressional Budget Office, which is analyzing that question, aides said.